Crude Oil on Fire – Prices Soars to Fresh 4- Years Top
What’s up, traders.
The WTI crude oil soared to a fresh 4- years high, crossing above the psychological resistance level of $72. It’s mostly due to the drop in inventories and increased global demand for the oil.
On Wednesday, the EIA reported a draw of 1.4 million barrels inventories, compared with analysts’ expectations for a decrease of 763,000 barrels. Secondly, a slight weakness in the U.S. dollar is also causing a rise in the demand for crude oil. As we know, the Fed is expected to keep the monetary policy hawkish. That being said, the stronger dollar makes crude oil expensive for global investors. Probably, the investors are pricing in the sentiments.
Crude Oil – Hourly Chart
Thirdly, the recent bullish wave is driven by the violation of ascending triangle pattern. As you can see on the hourly chart, ascending triangle extended solid resistance $71.75. Yup, it’s the same level we spoke about in our previous update. Anyways, the ascending triangle pattern is already violated and it has opened more room for buying crude oil until $72.45. Both of the leading and lagging indicators are in support of a bullish trend.
WTI Crude Oil – Trading Plan
At the moment, $71.70 is a good level to stay in a bullish position with a stop below $71.50 and take profit of $72.45 and 72.75. Good luck!